Neighborhood Effects on the Long-Term Well-Being of Low-Income Adults

Posted: 1 Oct 2012

See all articles by Jens Ludwig

Jens Ludwig

Georgetown University - Public Policy Institute (GPPI); National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Greg J. Duncan

Northwestern University - Institute for Policy Research; National Bureau of Economic Research (NBER)

Lisa Gennetian

National Bureau of Economic Research (NBER)

Lawrence F. Katz

Harvard University - Department of Economics; National Bureau of Economic Research (NBER)

Ronald C. Kessler

Harvard Medical School

Jeffrey R. Kling

Government of the United States of America - Congressional Budget Office (CBO); National Bureau of Economic Research (NBER)

Lisa Sanbonmatsu

National Bureau of Economic Research (NBER)

Date Written: July 12, 2012

Abstract

Nearly 9 million Americans live in extreme-poverty neighborhoods, places that also tend to be racially segregated and dangerous. Yet the effects on the well-being of residents of moving out of such communities into less-distressed areas remain uncertain. Using data from Moving to Opportunity, a unique randomized housing mobility experiment, we find that moving from a high-poverty to lower-poverty neighborhood leads to long-term (10 to 15 year) improvements in adult physical and mental health and subjective well-being, despite not affecting economic self-sufficiency. A 1 standard deviation decline in neighborhood poverty (13 percentage points) increases subjective well-being by an amount equal to the gap in subjective well-being between people whose annual incomes differ by $13,000, a large amount given that the average control group income is $20,000. Subjective well-being is more strongly affected by changes in neighborhood economic disadvantage than racial segregation, which is important because racial segregation has been declining since 1970 but income segregation has been increasing.

Suggested Citation

Ludwig, Jens and Duncan, Greg J. and Gennetian, Lisa and Katz, Lawrence F. and Kessler, Ronald C. and Kling, Jeffrey and Sanbonmatsu, Lisa, Neighborhood Effects on the Long-Term Well-Being of Low-Income Adults (July 12, 2012). Available at SSRN: https://ssrn.com/abstract=2155041

Jens Ludwig (Contact Author)

Georgetown University - Public Policy Institute (GPPI) ( email )

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Greg J. Duncan

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Lisa Gennetian

National Bureau of Economic Research (NBER) ( email )

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Lawrence F. Katz

Harvard University - Department of Economics ( email )

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Ronald C. Kessler

Harvard Medical School ( email )

Health Care Policy
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Jeffrey Kling

Government of the United States of America - Congressional Budget Office (CBO) ( email )

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National Bureau of Economic Research (NBER)

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Lisa Sanbonmatsu

National Bureau of Economic Research (NBER) ( email )

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Cambridge, MA 02138
United States

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